Comply with Subscription Laws in California and New York 2025

Understanding how to comply with subscription and auto-renewal laws in California and New York is essential for businesses in 2025. These states have strict requirements for automatic renewals, affecting everything from digital services to tangible goods. Non-compliance can lead to lawsuits and reputational harm. Read on to learn how to protect your business while keeping customers informed and confident.

California Automatic Renewal Law: Key Requirements and Best Practices

California Automatic Renewal Law (ARL), famously robust since its inception, was strengthened further in recent legislative updates. Businesses targeting California residents must include clear and conspicuous automatic renewal terms, obtain affirmative consumer consent, and provide simple cancellation methods. These regulations protect consumers from unwanted charges and deceptive practices, and authorities have become stringent about enforcement.

To comply:

• Present terms clearly: Highlight renewal and cancellation terms before payment in a manner that attracts the consumer’s attention.
• Get affirmative consent: Consumers must agree to auto-renewal terms separately, typically via a checkbox.
• Send confirmation: Deliver a post-purchase email or physical copy detailing renewal terms, how to cancel, and contact details.
• Remind before renewal: For subscriptions renewing after 31+ days, provide a clear reminder notice. This must include how to cancel and the renewal date.
• Ensure simple cancellation: Let customers cancel online—preferably through the user account—and refrain from retention obstacles.

Enforcement Example: In late 2024, California’s Attorney General settled with a major streaming provider for non-compliant disclosures—emphasizing the real-world risks of ignoring ARL requirements.

New York Auto-Renewal Law: Distinct Obligations and Updates

New York’s approach to auto-renewal regulation tightened considerably in recent years. Under New York’s law, especially after amendments effective late 2024, businesses must abide by requirements similar to California’s, with some unique distinctions:

• Automatic renewal disclosures: New York requires businesses to clearly and conspicuously present automatic renewal terms before completing the initial enrollment.
• Additional consent layer: For electronic agreements, the law demands an explicit opt-in related solely to the auto-renewal program.
• Enhanced cancellation process: An immediate online cancellation option must be offered whenever a customer enrolled online.
• Pre-renewal notifications: For annual and longer-term subscriptions, companies must send reminders at least 15-45 days before renewal—this must contain precise cancellation instructions and renewal pricing.

New York’s Division of Consumer Protection is proactive in investigating violations, frequently issuing guidance to aid businesses in compliance. Failure to adhere can result in heavy fines and negative publicity, especially as consumer awareness continues to grow.

Clear Presentment and Affirmative Consent: Essential for Compliance

The foundation of subscription law compliance in both California and New York revolves around transparent presentations and true consent. If customers are misled or auto-enrolled without understanding, both states consider it a violation—regardless of intent.

• Clarity of Terms: Use plain language. Avoid legal jargon when describing key terms, such as price changes, frequency of billing, and cancellation steps.
• Placement on Checkout: Place auto-renewal disclosure immediately adjacent to payment fields or prominently on the confirmation screen. Burying terms in hyperlinks or sub-pages is not compliant.
• Separate Consent Checkbox: Design your checkout so the customer must check a separate box acknowledging auto-renewal before completing the order—not pre-checked by default.
• Email Confirmation: The confirmation must include the recurring amount, renewal period, and easy cancellation details.

This transparent approach not only aligns with the law but also builds trust with your customer base—reducing chargebacks and complaints.

Streamlined Cancellation Procedures: User-Friendly and Legal

Both California and New York now scrutinize whether businesses provide a simple, direct, and easily executable cancellation process. In 2025, “hurdles” such as requiring a phone call, hidden menus, or lengthy questionnaires are increasingly seen as violations. The expectation, especially for online subscriptions, is an online cancellation method that’s as simple as enrollment.

• One-Click Cancellation: Integrate a one-step ‘cancel subscription’ button or clear cancellation pathway in the user account portal.
• No Detours: Do not require additional steps such as leaving the website, sending emails, or making phone calls—unless this is as easy or easier than the sign-up process.
• Immediate Effect: Ensure cancellation is confirmed immediately, with access or charges ceasing as contractually agreed (e.g., at the end of the billing cycle).
• Confirmation Notice: Always send written confirmation—email or SMS—confirming that the subscription is canceled and stating the effective date.

This not only aligns with regulatory expectations but also reduces the risk of chargebacks and negative reviews, supporting long-term customer retention.

Recordkeeping and Compliance Monitoring: Protect Your Business

Consistent with EEAT (Experience, Expertise, Authoritativeness, Trustworthiness), recordkeeping is critical when navigating auto-renewal compliance. Both California and New York can request documentation proving your compliance during investigations or consumer complaints.

1. Maintain Consent Records: Store time-stamped records of when and how each user gave affirmative consent to auto-renewal terms.
2. Retain Disclosure Formats: Archive screenshots or PDFs showing how terms appeared to customers at the relevant time.
3. Record Customer Communications: Keep copies of confirmation and renewal notification emails or letters.
4. Monitor Cancellations: Document all cancellation requests, processing times, and confirmatory communications.
5. Annual Compliance Audits: Regularly review your sign-up flows, disclosure language, and cancellation process to ensure ongoing alignment with updates in both states’ regulations.

Proactive documentation not only minimizes legal exposure, but also demonstrates a sincere commitment to consumer rights in case of inquiries, lawsuits, or regulator audits.

Staying Ahead: Preparing for Legal Changes and Consumer Expectations

Subscription and auto-renewal laws in California and New York continue to evolve reflecting mounting consumer advocacy and digital business models. In 2025, legislators in both states are considering measures to further tighten notice requirements and impose prompt refund mandates for improper charges. Remaining proactive is key:

• Monitor State Guidance: Subscribe to alerts from California’s Department of Justice and New York’s Division of Consumer Protection.
• Update Documentation: Immediately incorporate new requirements into your customer agreements and notifications.
• Train Staff: Ensure all relevant employees understand the current legal framework and know how to process cancellations efficiently.
• Engage Legal Counsel: Partner with an experienced attorney well-versed in consumer protection and subscription law to review your practices annually.

By anticipating changes and acting early, your business can avoid costly penalties and position itself as trustworthy in a marketplace increasingly wary of deceptive subscription tactics.

FAQs: Subscription and Auto-Renewal Laws in California and New York

• What is required for clear and conspicuous disclosure?

  The terms must stand out visually—using larger font, contrasting color, or clear placement. They should outline key aspects: price, frequency of charges, cancellation instructions, and renewal process.

• Are phone-only cancellations allowed?

  No, if customers enrolled online, both California and New York require an equally simple online cancellation option. Additional phone options are allowed but cannot be exclusive or onerous.

• What should pre-renewal notifications include?

  They must state the renewal date, new pricing if applicable, and clear cancellation steps. Timely delivery—typically at least 15 days before billing—is mandatory for annual or longer subscriptions.

• Do these laws apply to business-to-business (B2B) contracts?

  Mostly, these laws protect individual consumers. However, if B2B contracts resemble consumer agreements or a business is a sole proprietorship, laws may still apply. Always check with legal counsel.

• What are the penalties for non-compliance?

  Violating these laws can result in significant civil penalties, forced refunds, class action lawsuits, and public enforcement actions, along with reputational harm and ongoing regulatory scrutiny.

Ensuring compliance with subscription and auto-renewal laws in California and New York is not just a legal requirement in 2025—it’s a customer trust imperative. By embracing transparent disclosures, easy cancellations, and diligent recordkeeping, your business can maintain compliance and foster lasting customer relationships.